How will SD footage display on HDTV? Will its size be a lot smaller?

Normally the scaler circuitry takes care of the problem, you should have full screen video. I have an SD DVD player with 480p HDMI output connected to my 1920x1080 HD LCD monitor. Depending on how I set up my DVD player and the monitor, I can get full screen (16x9) or 4x3 video with black bars left and right.